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Analysis

Don't Expect an ACA Ruling Before Election Day

By John Commins  
   October 29, 2018

An injuction against the Affordable Care Act would create chaos for the statute's Marketplace plans, which begin enrollment on November 1. If such a ruling were handed down before the midterms, it would be a welcome gift for Democrats. 

It's been nearly two months since a U.S. District Judge in Fort Worth, Texas, heard oral arguments in Texas v. Azar challenging the constitutionality of the Affordable Care Act.

But court watchers hoping for a ruling soon probably shouldn’t expect anything from Judge Reed O'Connor until after the midterm elections next week, says Timothy S. Jost, professor emeritus at Washington and Lee University School of Law, and coauthor of the casebook Health Law.

"I'm sure Judge O'Connor is going to wait until after the election to rule," Jost says. "He's keeping his ear to the political news."

Healthcare has emerged as a top issue in the midterm elections, with 58% of voters in a recent Reuters/Ipsos poll saying they want to keep the ACA intact.  

Jost says a ruling in favor of Texas Attorney General Ken Paxton and Republican officials from 19 other states who want to slap an injunction on the ACA would provide a pre-election gift to Democrats, as well as create upheaval for Marketplace plans, which begin open enrollment on November 1.

That was not lost on Department of Justice attorneys, who during oral arguments last month urged O'Connor to delay any injunction until 2019 to avoid "chaos."

The Republican attorneys general argued that the ACA became unconstitutional when Congress zeroed-out the tax penalty for the individual mandate, thus invalidating the sweeping legislation in its entirety.  

A secondary argument by the plaintiffs focuses on the language in the 2010 statute, which says that the individual mandate is essential to creating a market in which guaranteed issued and preexisting condition exclusion bans are possible.

"The real question is what did the 2017 Congress intend to do when they zeroed out the tax?" Jost says. "Did they intend to get rid of the preexisting condition exclusions or not? You ask anyone in the Senate right now whether they think preexisting conditions should be excluded or not, they'll say, 'Oh no that's not what we did!'"

"So, the important question is when Congress repealed the tax in 2017 did they mean to get rid of the rest of the ACA?" Jost says. "Obviously they didn’t. They tried to amend parts of it in 2017 and they failed. To argue otherwise is just ridiculous."

Plaintiffs win likely
 

"When O'Connor does rule," Jost says, "he will probably hold that the individual mandate is unconstitutional and throw out the guaranteed issued community rating and the pre-existing condition ban."

"He might also throw out all of Title I, the exchanges, premium tax credits, and the premium stabilization programs, maybe even insurance reforms such as the age rating," Jost says.

"It's very unlikely he is going to throw out the Medicare donut hole closing, and the generic biologics provisions and the reforms to the Indian Health Service and all the other things that are inconceivably, not related to the individual mandate," Jost says.

Appeal is Certain
 

If O'Connor rules in favor of the Republican plaintiffs, that will most assuredly prompt an appeal to the 5th Circuit Court by the Democratic attorneys general from 17 states, who intervened when the DOJ said it would not fully defend the ACA.

"The 5th Circuit, last time I checked, had as many Trump appointees as from prior Democratic presidents," Jost says. "Although frankly I think the argument is ridiculous, there is some chance the 5th Circuit would uphold it."

"Then it goes to the Supreme Court. I think the Supreme Court would very likely reverse," he says, "but we do have a fairly conservative court at this point. I am not absolutely sure if they would."

Gail Wilensky, a former director of Medicare and Medicaid and a former chair of the Medicare Payment Advisory Commission, previously told HealthLeaders that she's skeptical this case will make it all the way to the Supreme Court. If it does, though, she would expect the justices to side against the plaintiffs, rejecting their approach to severability.

“I'm sure Judge O'Connor is going wait until after the election to rule. He's keeping his ear to the political news.”

John Commins is a senior editor at HealthLeaders.


KEY TAKEAWAYS

Republican attorneys general from 20 states want a federal judge to impose an injuction on the ACA.

A ruling is unlikely before next week's mid-terms.

The severability of the ACA's so-called individual mandate is a key issue in the suit.


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